Is USA Gasoline Demand Leveling Off?

(The views and opinions expressed in this article are those of the attributed sources and do not necessarily reflect the position of Rigzone or the author.)

In recent months, headlines on Rigzone and other oil and gas industry websites have touted robust gasoline demand in the United States. The U.S. Energy Information Administration (EIA) tracks volumes of refined products supplied across the country on a weekly basis, and its figures for finished motor gasoline imply demand for the fuel. Here is a breakdown of EIA’s finished motor gasoline supplied figures during a recent six-week span:

• Week of June 4, 2021: 8.48 million barrels per day (bpd)
• Week of June 11, 2021: 9.36 million bpd
• Week of June 18, 2021: 9.44 million bpd
• Week of June 25, 2021: 9.17 million bpd
• Week of July 2, 2021: 10.04 million bpd
• Week of July 9, 2021: 9.28 million bpd.

The direction of implied gasoline demand figures for the weeks of June 25, July 2, and July 9 upset the previous three weeks’ growth trend. The finished motor gasoline supplied figure that EIA reports this week will put the more recent figures into greater context, according to one of Rigzone’s regular market-watchers. Keep reading to find out why.

Michael Osina, Partner in Charge, Energy – Tax, Grant Thornton LLP: Tax policy will continue to be interesting to watch going forward. The current administration is clearly focused on a cleaner environment, and it is easy to see why the fossil fuel industry is at the top of the list when it comes to cutting tax incentives. ESG (environmental, social, and corporate governance) is also becoming the new favorite buzz word(s) for companies looking to get ahead and/or show that they are environmentally conscious. It’s unclear how much outsiders to the industry will really give credit for ESG efforts by oil and gas companies, but it’s a step in the right direction.

Mark Le Dain, vice president of strategy with the oil and gas data firm Validere: Implied demand fell in the U.S. Department of Energy weekly inventory update this past week. This next week will be critical to understanding if this was lumpy due to holidays (reduced business driving) or if demand in the U.S. is reaching more of a steady state for the summer. We are of the view that there may be some near-term uncertainty but that gasoline demand will continue to tick higher this summer. 

To contact the author, email mveazey@rigzone.com. EIA figures cited in this article appear on the agency’s web page presenting U.S. Weekly Product Supplied.